Pub and hospitality bosses have rounded on Keir Starmer’s suggestion that relaxed licencing laws may compensate the industry for business rates bills having risen at the Budget, branding the proposal “a load of rubbish”.
The Prime Minister confirmed his government was talking to industry leaders about “what further support” ministers could provide pubs and other hospitality firms after a nationwide backlash broke out in the wake of November’s business rate hike.
He told LBC that relaxing “licencing freedoms” was among several measures on the table to help alleviate pressure on British landlords, hundreds of whom have barred Labour MPs from their pubs as part of a campaign railing against the amount of tax they pay.
But senior industry figures have roundly rebuked Starmer’s licencing proposal, saying it is government-imposed cost pressures that have led to one pub closing every day in England and Wales.
Andy Lennox, a landlord, restaurateur and founder of the Wonky Table lobby group behind the ‘No Labour MPs’ campaign, branded the licencing suggestion “an utter whitewash that nobody needs”.
“We’ve never asked for them,” he told City AM. “No trade body that I’ve ever spoken to has said that the industry wants to be open until one o’clock at night. I have a 2am licence and I don’t use it.”
The government offered hospitality and retailers a 5 per cent discount on their business rates – the commercial equivalent to council tax – as part of an overhaul of the property tax promised in Labour’s election-winning manifesto. But most landlords found their business rates bill had in fact risen, after the government agency that oversees the tax judged the value of their properties had risen dramatically since its last assessment.
Sacha Lord has previously branded the business rates overhaul a “stealth tax”
Licencing freedoms a ‘whitewash’ for pubs
The effective tax rise came at a time when the sector’s industry bodies were already locked in a campaign for ministers to give the struggling sector a VAT cut, after it was especially damaged by the payroll tax raid announced in the previous Budget.
Sacha Lord, chair of the Night Time Industries Association and and creator of Manchester’s Warehouse Project, told City AM any government measure other than a further business rates or VAT reduction was “pointless”.
“The chat about extending licensing hours is pointless,” he added. “In reality, hospitality are cutting hours as they can’t afford to stay open.”
City AM understands Treasury officials have begun talks about measures to offset the business rates rise, which is set to come into force in April. The British Beer and Pub Association said ministers were beginning “to understand the strength of feeling” in the industry.
Starmer and Chancellor Rachel Reeves have already launched one attempted overhaul of pub and hospitality venue licencing. In July, the government unveiled a suite of measures to improve sector’s operating conditions, including devoting areas in towns ‘hospitality zones’ to fast-track planning applications and protecting long-standing venues from noise complaints.
Kate Nicholls, the chair of UK Hospitality, said it was “good to hear from the PM a recognition of the scale of the problem”, in response to him
“Recognition is positive,” she added. “And we stand ready and willing to be able to have a dialogue with him on the solutions that are needed to address this. The focus absolutely has to be on the tax burden – nothing else is going to cut it.”